Novartis, FTC agreement paves way for $16bn buyout of GSK’s cancer unit
Swiss pharmaceutical company Novartis can buy London-based GlaxoSmithKline’s (GSK) portfolio of cancer drugs after it agreed to meet certain conditions set by the US Federal Trade Commission (FTC), the agency has said.
To secure US approval of the transaction, Novartis has agreed to divest assets related to drugs covering BRAF and MEK inhibitors—which treat melanoma and are also being developed to treat other cancers—to Colorado-based biotechology company Array BioPharma.
Last April, Novartis and GSK announced the three-part deal, in which Novartis will buy GSK’s oncology portfolio while GSK will acquire Novartis’s global vaccine business. At the time, GSK said it was the most significant transaction for the company since its creation in 2000.
The FTC had complained that the $16 billion transaction would likely be anti-competitive, as the companies are two of a small number of businesses that are either developing or marketing drugs focusing on BRAF or MEK inhibitors, and are two of just three companies that develop or market the drugs to treat melanoma.
If the deal goes ahead, Novartis will likely delay or stop developing the BRAF and MEK inhibitor drugs as well as a combination product.
The terms of the FTC agreement state that Novartis must ensure that Array continues to develop the products and that competition in the BRAF and MEK inhibitor drug markets is not reduced.
